(CNSNews.com) - The CEO and Chairman of Microsoft Bill Gates said that capitalism’s “systemic" problems are not doing enough for research and “the needs of the poorest.”

“In general, the world underfunds research because the person who takes the risk of doing the research doesn’t capture the full benefit of having done it; and so you know, capitalism does amazing things but it has one systemic problem in terms of research -- that it won’t do enough,” Gates said at the mHealth summit in Washington on Tuesday.

Capitalism "has another systemic problem in that the needs of the poorest will not be prioritized the way they would if you put a more human-values-driven system in. Now, of course we have government that comes in and does its best to take, you know, the beauties of capitalism, which work for so many things and is so fantastic and whenever it can be used, it is better than government.”

Kent comments:

Whether you love, hate, or are indifferent to Microsoft products, you have to admire Bill Gates as an inventor, developer, and businessman. But his great success in these areas does not prove his competence anywhere else, as evidenced by his comments above.

I am going to talk about ‘the market’ here. There is, among those who care, a substantial debate about the appropriateness of thinking of ‘the market’ as capitalism. After all, ‘capitalism’ was the derisive name Marx applied to the free market.

There is also the problem of just how appropriate, and helpful for understanding, it is to think of ‘the free market’ as some kind of independent entity. When I talk about ‘the free market’ I am talking about what happens when individuals are generally unhindered by outside forces (like governments, or other thugs) in their economic exchanges. If you are clear on how I am using the terms, let’s consider what Mr. Gates says about capitalism.

‘The world’ does not ‘underfund’ anything, because ‘the world’ cannot fund anything. Individuals with funds do all the funding in the world. Now if people are free to use their funds as they desire (and this is a theological point because of the Eighth Commandment), then they will fund research just as much as they wish. So when Mr. Gates says capitalism “won’t do enough” research, what he is really saying is that free people won’t do as much research as he thinks should be done. But when he tries to make what he wants normative for everyone else, he reveals something of a tyrannical tendency.

Bill can fund just as much research as his billions will fund. But he has no business, and certainly no moral right, to tell the rest of us how much research we should fund. In fact, his whole comment here is just a bit idiotic.

Mr. Gates’ second comment seems to deteriorate into some kind of babble, but I think I can detect what he is trying – without much eloquence – to say. “The needs of the poorest will not be prioritized the way they would” in a “more human-values-driven system.” Mr. Gates is thinking in terms of ‘systems.’ Perhaps we should expect this from a computer guy. But free people acting as they will economically is not a ‘system’ in this sense.

All the individuals in the world who work, buy, build, trade, and so forth are human beings. One of the things they can and do decide to do is give of their resources to help the needy. Since they are human beings, what they do is – of course – driven by ‘human values.’ Some value charity more than others. But in a free market it has little to do with any ‘system’ .

A free market is free just because no economic values are imposed on anyone. This is not a ‘system’ – it is an anti-system. If Mr. Gates does not agree with the human values of the human beings who interact in the market, he would be free in a free market to try to convince people to adopt different, more charity-oriented values.

He could start by giving away more of his billions to the needy. His foundation does some of this sort of thing. Unfortunately, his foundation also gives grants to groups to help them get government funding. This kind of funding necessarily comes at the expense of the market and at the expense of freedom.

Bill Gates might know a lot about operating systems for computers. But when it comes to freedom, ‘capitalism’ and the market, he really needs to read one of those “For Dummies” books.